Tuesday, July 12–Jim Wyckoff’s Morning Markets Report
Global stock markets were mostly weaker overnight. U.S. stock indexes are pointed toward lower openings when the New York day session begins. Trader and investor risk appetite remains dented amid recession and inflation fears. Asian countries are also dealing with the worrisome spread of Covid.
The U.S. data point of the week will be Wednesday’s consumer price index report for June, which is seen coming in up 8.5%, year-on-year. In the May report, CPI was up 8.6% annually.
The key outside markets today see Nymex crude oil prices solidly down and trading around $99.50 a barrel. The U.S. dollar index is up and hit another 20-year high early today. The yield on the 10-year U.S. Treasury note is fetching 2.921%.
U.S. economic data due for release Tuesday includes the weekly Johnson Redbook and chain stores sales indexes, the NFIB small business index, and the IBD/TIPP economic optimism index.
–Jim
U.S. STOCK INDEXES
September S&P 500 e-mini futures: Prices are lower again in early U.S. trading. Bears have the firm overall near-term technical advantage. The shorter-term moving averages (4-, 9- and 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day is above the 18-day moving average. Short-term oscillators (RSI, slow stochastics) are bearish early today. Today, shorter-term technical resistance comes in at last week’s high of 3,922.00 and then at 3,950.00. Support for active traders is seen at 3,800.00 and then at the July low of 3,744.00. Wyckoff’s Intra-day Market Rating: 4.0
September Nasdaq index futures: Prices are weaker in early U.S. trading. Shorter-term moving averages (4- 9-and 18-day) are bullish early today. The 4-day moving average is above the 9-day. The 9-day average is above the 18-day. Short-term oscillators (RSI, slow stochastics) are neutral to bearish early today. Shorter-term technical resistance is seen at last week’s high of 12,211.00 and then at 12,500.00. On the downside, shorter-term support is seen at the overnight low of 11,758.25 and then at 11,500.00. Wyckoff’s Intra-Day Market Rating: 4.0.
U.S. TREASURY BONDS AND NOTES FUTURES
September U.S. T-Bonds: Prices are higher in early U.S. trading. Bears are still in overall near-term technical control. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is even with the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term technical resistance is seen at 141 even and then at the July high of 142 6/32. Shorter-term support lies at 139 even and then at the overnight low of 138 18/32. Wyckoff’s Intra-Day Market Rating: 6.5
September U.S. T-Notes: Prices are higher in early U.S. trading. Bears are in overall near-term technical control. Shorter-term moving averages (4- 9- 18-day) are neutral early today. The 4-day moving average is below the 9-day. The 9-day is above the 18-day moving average. Oscillators (RSI, slow stochastics) are neutral to bullish early today. Shorter-term resistance lies at the overnight high of 119.03.0 and then at 119.10.0. Shorter-term technical support lies at 118.20.0 and then at the overnight low of 118.09.5. Sell stops likely reside just below those levels. Wyckoff’s Intra-Day Market Rating: 6.5
EURO CURRENCY
The September Euro currency futures are lower and hit another 20-year low in early U.S. trading. Bears have the strong overall near-term technical advantage. The shorter-term moving averages for the Euro are bearish early today, as the 4-day is below the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators for the Euro are bearish early today. The Euro currency finds shorter-term technical resistance at 1.0150 and then at 1.0200. Shorter-term support is seen at the overnight low of 1.0048 and then at 1.0000. Wyckoff’s Intra Day Market Rating: 3.5
NYMEX CRUDE OIL
Nymex crude oil prices are solidly lower in early U.S. trading. The shorter-term moving averages are bearish early today as the 4-day is below the 9-day. The 9-day is below the 18-day moving average. Short-term oscillators (RSI and slow stochastics) are bearish early today. Look for buy stops to reside just above technical resistance at $101.00 and then at $102.00. Look for sell stops just below technical support at $97.00 and then at the July low of $95.10. Wyckoff’s Intra-Day Market Rating: 4.0
GRAINS
U.S. grain futures were lower overnight. It appears there was a “flash” weather market in the grains that has already fizzled. Still, recent solid gains suggest near-term market bottoms are in place. On tap today is the monthly USDA supply and demand report. Then attention will return to weather forecasts for the Corn Belt, which remain mostly warmer and drier, but with scattered rain chances. Recent price action in the grains does lay out the likely trading ranges for them in the coming weeks: the mid-to-late-June highs to the July lows.
IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any traders and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.
Here is what the Commodity Futures Trading Commission
(CFTC) has said about futures trading (and I agree 100%):
1. Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.
Jim Wyckoff